151. The Politics of Income Inequality in the United States.
- Author
-
Kelly, Nathan J.
- Subjects
- *
INCOME inequality , *POLITICAL science , *WELFARE state , *POLITICAL systems , *IDEOLOGY - Abstract
In this paper, I address how political, economic, and demographic change have influenced the path of income inequality in the United States from 1947-2000. I utilize and build on theoretical insights from the macro politics model in American politics and theories of welfare state development from comparative politics in order to explain the path of income inequality in America. I show that income inequality is a fundamental part of the macro political system of the United States. It is both influenced by political dynamics and is a causal force in its own right, helping to shape the dynamics of public policy in America. Most fundamentally, political dynamics (primarily party control of government and the ideological tone of policymaking) influence distributional outcomes through two mechanisms---redistribution and market conditioning. I describe these two mechanisms and test the degree to which politics shapes inequality through these mechanisms, reaching the somewhat surprising conclusion that explicit redistribution is less important than market conditioning. The vast majority of distributional impact that can be allocated to political dynamics comes through market conditioning rather than the taxes and transfers of the traditional welfare state. In the end, when Democrats control government and liberal policies are enacted, income inequality declines substantially, and the effect of these macro political dynamics is similar in importance to economic and demographic change. ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]
- Published
- 2008